Selling a metal fabrication or stamping company

Both certificates name the certified organization and its sites, and the certification contract requires the company to tell its certification body about a change in ownership. The certification body then decides what the change needs, which can include a short-notice or special audit.

In a stock sale the certified company continues, so the certificate normally carries on once the change is reviewed. In an asset sale the buyer needs its own agreement with a certification body, which decides whether to reissue the certificate or treat the buyer as a new client.

The AIAG PPAP manual ties customer notification and resubmission to physical changes: moving tooling or equipment to another plant, changing sub-suppliers for materials or services, and new, modified or long-idle tooling. A change of ownership on its own is governed by each customer's own requirements and purchase terms.

Those terms commonly require prompt notice of an ownership change, and some let the customer terminate or withhold consent to assign its purchase orders. A sale that keeps the same site, tooling and suppliers usually keeps existing approvals, but each customer's requirements decide.

Under Section IX of the ASME Boiler and Pressure Vessel Code, procedure and welder qualification records can pass to a new owner without requalification if the new owner takes responsibility for them, revises the procedures to show its name and documents where the records came from.

AWS D1.1 places qualification on each contractor, which qualifies its own procedures unless they are prequalified and is responsible for its welders' qualifications. An asset buyer working to D1.1 should plan to requalify or obtain the engineer's acceptance. AWS Certified Welders and Certified Welding Inspectors carry their credentials with them.

ASME issues its certificates to a legal entity, and they cannot be transferred from one company to another. A company that changes ownership but keeps its ASME quality program can usually have its certificate updated if it accepts responsibility for earlier Code work. A buyer of only the assets must apply and pass a new review before it can stamp Code work.

AISC certificates are not transferable between owners and cannot be listed as an asset in a sale. AISC reviews each change of ownership case by case, may require an additional audit, and expects notice within 30 days of the change.

Dies a customer paid for are normally the customer's property, held by the stamper under a tooling or bailment agreement, tagged as the customer's and returnable on demand. Tooling recovered through the piece price is different: the purchase order and amortization terms decide who owns it.

Customer-owned dies are not the seller's to sell, so they are reconciled to tags and customer records and left out of the asset list. Several states, including Michigan, Ohio, Illinois and Wisconsin, have tool and die lien laws that affect unpaid or long-unclaimed tooling.

New Jersey is the leading example of a state where the sale itself triggers environmental duties. Its Industrial Site Recovery Act covers fabricated metal manufacturers by industry code. A sale of the business, its real estate or a controlling interest requires notice to the state within five days of signing, and a remediation path must be in place before closing.

Connecticut has replaced its former transfer law with a program triggered by discovered releases, and states such as Michigan and California require disclosure of known contamination when real estate changes hands. Checking the rules in each state where the company operates belongs early in the process.

In a stock sale the permit holder stays the same, so permits generally continue with updated contacts and any notice the agency requires. In an asset sale each permit follows its own rule. A federal Title V air permit transfers by amendment with a written agreement naming the transfer date, and state air permits set their own notice rules.

Under industrial stormwater general permits, the new operator files its own notice of intent and the old operator a notice of termination. A sewer authority's industrial user permit cannot transfer without at least prior notice. A phosphate wash ahead of a paint or powder line can bring a shop under the federal metal finishing wastewater rules, so buyers look closely at it.

Under federal Superfund law, a buyer that takes title to a property becomes its owner. To claim the bona fide prospective purchaser defense it must, among other conditions, complete all appropriate inquiries before closing. That normally means a Phase I environmental site assessment to the ASTM standard EPA recognizes, completed within the year before the purchase.

In a stock sale the company keeps its own history, so a Phase I measures that exposure rather than removing it. Asset buyers can also face successor liability in some circumstances, so purchase agreements allocate known and unknown environmental risk through indemnities, escrows or insurance.

In a stock sale the employer does not change, so a collective bargaining agreement stays in force. In an asset sale, a buyer that continues the business and hires mostly the seller's unionized employees must recognize and bargain with the union, but it is not bound by the old contract unless it agrees to be.

Under the federal WARN Act the seller is responsible for any required plant-closing or layoff notice through the closing date and the buyer after it, and the seller's employees count as the buyer's immediately after the sale. Several states have their own notice laws. New Jersey's, for example, adds longer notice and mandatory severance for larger employers.